Can You Afford To Retire 25 Years Early? One Couple Says Yes

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Dan Caplinger is an attorney and financial planner covering retirement, ETFs, personal finance, and general investing for the Motley Fool. With nearly 20 years of diverse experience as a tax and estate planning lawyer, trust administrator, personal financial advisor, and independent consultant, Dan has developed a healthy skepticism of the mainstream financial industry and aims to make complex legal and financial concepts easier for his readers to understand. Dan has worked with the Motley Fool since 2006 as a retirement, tax, and investing expert with a focus on introducing new investors to the opportunities of smart financial planning.

If you're tired of the grind and ready for the change of your life, you might want to follow in the footsteps of Akaisha and Billy Kaderli.

Twenty years ago, the Kaderlis retired at the age of 38 and started traveling the world. Now, they're helping others find their early retirement paths via their website and the numerous books they've written.

Retiring 30 years before their peers was simply a matter of working hard, saving a lot, spending little and investing wisely, they say: "While still working, we took a look at our spending and realized that after we took all our work-related items and fixed monthly expenses into consideration, we really didn't spend that much on ourselves."

Retiring Early Requires an Attitude Adjustment

Once the Kaderlis realized that with some changes they could finance a comfortable lifestyle, they felt like they were no longer captive to their jobs, so they set out on the path toward early retirement: "We could choose whether to keep working 80-hour weeks. That's a very powerful feeling. We chose to find a more fulfilling lifestyle."

In their new book, Your Retirement Dream IS Possible, the Kaderlis provide the tools to help ordinary people achieve their retirement dreams, even in today's dire economic climate. Drawing upon their 20 years of retirement and extensive travel, they reveal how they've been able to live a gratifying, debt-free lifestyle on less money than one would think.

Here they share four things that helped them leave the 9-to-5 working world and live a more satisfying life:

1. Don't feel chained to the traditional concepts of retirement

"You don't need a guaranteed pension or health care to retire; you can create what you need and want for yourself. You just have to know how to prioritize, know what you value, and know that you are in charge of your life. Once you know that, the rest is easy."

2. Stop letting "stuff" dictate your future

"Don't let material things take away your freedom. We see people ruled by fear and a sense of having no control over their lives, when simple decisions about how they spend their money could change everything.

People need to take a look at what is important to them and then prioritize their expenses. If they look hard, they will realize that the unpaid car in the driveway, their credit card debt, and their mortgages are not sources of happiness. In many ways, these debts keep them trapped in an unsatisfying lifestyle and narrow their opportunities and choices. Modifying their costs of housing, transportation, tax liabilities, and food is where they need to start."

3. Attitudes about money are not universal

"The locals are very receptive to us wherever we have traveled. We learned a long time ago to respect people everywhere, and they return that respect. In the countries we have visited, everyone is trying to improve their lives as best they can, even when they don't always have good ways to build wealth. Some cultures are very interdependent, focusing on family businesses as a manner of upgrading their standard of living.

By contrast, Europeans we've spoken with on the road have a hard time understanding that we've financed our own retirement. In our experience, they just don't have the same entrepreneurial spirit."

4. Retirement isn't an endpoint, it's a beginning

"In our 20 years of financial independence, we've spent time volunteering, traveled through many countries, and learned new languages and valuable skills. It's been more than we could have ever imagined. This lifestyle keeps us mentally and physically flexible, and our financial tracking system keeps us secure for when unexpected events happen."

The First Step Toward Retiring Early – Start Today

When I asked the Kaderlis to give me the most important piece of advice for someone considering early retirement, they pointed to understanding and controlling your spending: "Track your spending to understand what financial outlays you have. Manage your cost-per-day figure in the way we illustrate in our book. These two tools will give you great personal and financial freedom and will change your life. Then, if you are serious, rent out the house and go travel for an extended period of time. You just might never come back!"

Motley Fool contributor Dan Caplinger expects to follow the Kaderlis down their path when he's ready. You can follow him on Twitter here.

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Lorenzo

In my own, all too brief, travels, I've come across people in their 30s and 40s who live on a shoestring, traveling around the world, typically (if American) with no permanent home and little or no health insurance. Are these vagabonds "retired"?

Joe is right. These people seem interesting and I admire their lifestyle but calling it "retirement" is a little silly. Living frugally and contributing as much as you can reasonably afford to your retirement accounts is smart. On the other hand, you want to live comfortably enough to enjoy life - whatever that means for you. I don't need an expensive car but I'd rather buy an inexpensive new car rather than dealing with high maintenance. Where most people fail is spending beyond their means (like our genius government) and worrying about keeping up with the Joneses.

Doc,I believe you missed my point. The Kaderli's should not be writing books about early retirement, but instead writing books about entrepreneurship. Good for them that they can travel the world and make their own schedules etc.. But I think there are millions of people across the world who own their own businesses, have flexible schedules and would never consider themselves retired.

Seems Joe and others don't understand the concept (or at least my concept) of retirement. To me retirement is not about finally being able to do nothing. It is about having he freedom to do what you want, when you want, and being able to tell anyone to go piss up a rope if you need to. I'm retired but spend time volunteering, working with high school baseball players (which I am paid a little bit for) as well as haviing free time to read, exercise and doing other things. The Kardilis have just chosen to do this on the road. As for making money by selling their books to us "poor dumb schmucks" : To think it a worthless purchase is to think you have all the travel answers, so therefore you should not read any travel literature of any kind. I often buy travel books just to help support the people who have had the guts to go out and write their own script for their life and put convention behind them. If Joe and like minded people want to stay handcuffed to one spot (and theire is absolutely nothinig wrong with that if it is what they really want) that is their choice. However, don't belittle someone else simply because they choose a different lifestyle. Would be interesting to compare the help and assistance each of the families give to other people and the good they do outside their own immediate family. Good travels (to everyone)

This is a bit of a joke. My wife and I are by far the most frugal people we know. Our cars are paid off, our student loans are paid off etc...we are 100% debt free. We are both 31yrs old, 1 daughter and planning to start trying for a 2nd child. We have a combined $110,000 in retirement funds and an annual income of $125,000. Our net worth is about $175,000 by age 31! So, compared to our peers of the same age we are WAY ahead. We max out our 401k's each yr and live on a total budget. Our budget is strict. If we don't have enough in our entertainment budget by weeks end, we sit at home and play board games. We don't have cable, but an old antenna on our roof. We live in my wife's grandfather’s house, rent free...and will do so for at least another yr until we buy. Anyway, with all of this, we can not retire by 38...no way! At our current savings, spending, budgeting pace...we can have a semi comfortable retirement by 50, which is great!!!The fact that this couple acts like they have it all figured out and retiring comfortably at 38 is possible is laughable.I just visited their website. The entire thing is a billboard. They sell advertising space...their books, push different products and retirement tools, for sale of course. They can't make the statement of "you can retire 25yrs early, just buy our books to find out how"...when they obviously put work into writing books, maintaining their website, selling advertising etc...I think they could potentially boast about starting up your own company, but not sure how selling books, advertising, financial tools etc, equates to retirement.

I didn't see anything in this about family...do they have children? If so, did they have college or other expenses? Or is this a case of a couple dedicated only to themselves? Nothing illegal about that, but for those who choose to have families, the challenge to go this route would be much greater (though certainly not impossible).

In other words: live beneath your means while you are working, save money, understand that "stuff" is just that, and then enjoy as much of life as possible without being enslaved to corporate America?

I don't think I need a book for that advice. I've found myself unemployed earlier than I've expected, and because of the job market and economy I don't think I have any choice but to retire, which is just fine.

Question: What is their level of education?, How much money did they earn? What Part of the country did they live in? A few thoughts - Without high paying jobs, it is hard to save anything, what with Federal, State and Local Taxes. If you have children and need to take care of them yourself, without Government money, to (Feed, Cloth Educate), Where Do You Get The Money, to save? What do they suggest, those in poor health to do?